File this one under “Duh!”:
The U.S. Labor Department, at the urging of Federal Reserve Chairman Alan Greenspan, is working to fix a “statistical quirk” that causes the government to routinely underestimate the number of newly unemployed Americans each week, a department official said on Tuesday.
Each Thursday, Labor issues its count of Americans filing initial claims for state unemployment benefits in the latest week. In 51 of the past 52 weeks, it has also revised the previous week’s number upward, making the picture less rosy than it originally appeared. The weekly jobless claims figures are closely watched by financial markets as the most timely measure of U.S. employment. The data’s importance has climbed in recent months as concerns about a “jobless recovery” from the 2001 recession threatened to undermine economic growth and the Fed warned that unemployment could dampen vital consumer demand.
Data Underestimates New Jobless Claims
Reuters, November 18, 2003